What is digital debt collection and why it works

Customer expectations and behaviour have undergone dramatic shifts over the past decade, especially around how they like to be communicated with. Customers expect organisations to interact with them digitally and treat them with respect. And when it comes to debt collection, the same applies – customers expect a more human experience.

Unfortunately, debt collection is an industry that has long struggled with its image, especially around the poor customer experiences the traditional model delivers. A common issue with the traditional agency is its one-size-fits-all strategy that relies on making many calls to customers – often using an aggressive or intimidating manner.

This approach ends up hurting organisations financially because customers are even less likely to resolve their accounts after being harassed. Organisations may even suffer damage to their reputation and brand if customers take to social media to complain about their treatment. This is why the most logical step with collections is to turn to a digital debt collection agency.

Digital debt collection defined

Digital debt collection is a data-driven solution that uses technology to improve upon traditional collections methods while enhancing the customer experience. A digital debt collection platform uses the insights it gains to deliver personalised messages in the communications it sends to customers.

Customers can also be contacted via their preferred digital means such as email or SMS. Once they receive a message, they can then choose to self-serve by responding and making payments digitally using the channel they prefer at the time of their choosing. All these elements provide for a more human experience which in turn results in more successful recoveries.

In the past, talking to a debt collector could be intimidating. But with a digital debt collection agency, there’s no need for customers to talk to a person at all – unless they want to. At InDebted, we have a global Customer Service team that provides support to customers no matter where they’re based.

A personalised, customer-centric approach

But there is much more to a digital agency than allowing customers to communicate in the way they want, when they want. Being digital means customer insights can be collected in real time and leveraged to develop machine learning models to deliver a much more personalised approach. For example, at InDebted, if we find a customer engages with an email first thing in the morning, then our intelligent collections product, Collect, will ensure that emails are sent to that customer in the morning. These personalised engagements mean we’re able to make the most of every customer interaction, which ultimately benefits the organisations we work with through more successful recoveries and an enhanced reputation.

How positive experiences are a win-win

Putting customers front of mind is important to digital debt collection agencies, and the way we incentivise our team at InDebted is proof of this. While agents who work in a traditional debt collection agency are motivated and compensated based on how much of a debt they recover, our Customer Service team (not ‘collectors’) are paid according to how they deal with each customer’s situation and the feedback they get as a result. A look at our Google ratings received for customer satisfaction shows InDebted regularly receives 5-stars from customers – a highly unusual result for a debt collection agency.

Having customers show how satisfied they are isn’t only good for the collection agency – the organisations also benefit. If customers have a positive experience with a debt collector, they’re not only more likely to resolve their account, but they’re also more likely to stay loyal to the organisation. And with today’s customers having the power of social media at their fingertips, ready to share any poor experiences, a positive interaction means an organisation’s brand and reputation remains intact.

The saying “the customer is king” has never been more relevant than it is today – and this applies to all customers, even those with overdue accounts. If organisations want to retain their customers as well as their brand image, then engaging a digital-first debt collection agency is the only – and wisest – option.